Why Should We Separate Personal Accounts from Business Accounts?

[Suba]

We often encounter business people who mix or do not separate personal accounts from business accounts, so that all financial transactions become a single entity that is difficult to read even by a professional. Most of them only focus on getting the highest possible profit and making expansion plans, etc. but unfortunately they forget about financial management. So in your opinion, why should business people separate personal accounts from business accounts?

 

[Augusta]

Business is a separate entity it should have separate account. So that all that has to do with it , Is run from that account same with our personal account

 

[eLdavis]

This is because your business is an entity on it's own, then again this would help you when it comes to managing your finance.

 

[Fidelia]

It helps you to have financial control over how much of your personal and business income overlap into each other. Best thing is that you don't even manage your business account yourself.

 

[Augusta]

With two separate you would be able to put things in the right perspective. They can't be more confusion as you are dealing with two distinct account

 

[Patty]

You won't want to be spending business money on personal needs. That's the major reason for seperating the two accounts.

 

[Springtime]

Mixing the two accounts will cause confusions when you need to analyze the financial situation of your business.

 

[King Belieal]

I don't ever join the two accounts together. Regardless of the discipline, you would always be tempted to spend funds for the non intended purpose.

 

[Augusta]

You won't want to be spending business money on personal needs. That's the major reason for seperating the two accounts.

Yes you would need to know the two and differentiate them. You need to avoid trying to use your business money for personal use

 

[Nomad]

In our country, the law demands you have a seperate bank accounts for personal and business transactions. You will be penalized if you do business from personal account

 

[neku]

While separation is recommended for larger businesses, greedy government employees fake ownership of the current account of private citizens and get great powers, monthly government salary.

 

[Starmix]

Business account should be separated from the personal account to monitor the profit from business. The business owner can assess how much he saves weekly or monthly, whereas for a personal account, it is all up to the account owner how much to save in a week or in a month, It's a case to case though.